Nokia Windows Phone Competitive With iPhone, Barclays Says

By Dimitra DeFotis

Barclays Capital issued a mostly positive review late Thursday of Nokia’s two new Lumia Windows phones unveiled this week. In sum: competitively priced, not overly differentiated.

“We believe all six devices will be competitive in the marketplace from both hardware and pricing standpoints. Nokia in fact highlighted that pricing tariffs for the Lumia 800 and Lumia 710 will be one notch cheaper than the iPhone 4S across all launch markets … we have been positively surprised by the large number of [wireless] operators involved (an average of 5 per country where the device will be launched in Western Europe this quarter).”

The Lumia 800 from Nokia (NOK) boasts an 8 megapixel Carl Zeiss camera, 3.7-inch touch screen and 1.4 gigahertz single core processor, but is “not overly differentiated,” notes the foursome of Barclays analysts in New York and London covering Nokia. While the 800 is priced at 420 euros (about $594), it will be free with some two-year contracts. And, with some 12- and 18-month contracts, “the Lumia 800 is even more competitively priced when compared to the iPhone and the Galaxy SII,” Barclay’s concludes.

The 800 is to roll out with 31 phone providers across France, Germany, Italy, the Netherlands, Spain and the UK beginning in November. Nokia adds Hong Kong, India, Russia, Singapore and Taiwan markets in the fourth quarter, and the U.S. and China in the first half of 2012.

Barclays is decisively upbeat compared to the initial skepticism we published, with a $10 price target. Barclays’ analysts say the 4Q launch is only the start of Nokia’s work with Microsoft on the Windows operating system. They conclude the second quarter “was the bottom” and that debate will shift to operating margins.

Conclusion: “we should expect to see greater differentiation across Nokia’s WP7 devices in future software updates.”

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There are 16 comments

OCTOBER 28, 2011 9:58 A.M.

Thomas in MO wrote:

"Hardware and price are competitive with iPhone." But the iPhone is all about software and the ecosystem. the hardware is just a shell and chips that any copy cat can order and assemble.

OCTOBER 28, 2011 10:07 A.M.

Tim Henderson wrote:

BBX will crush both

OCTOBER 28, 2011 10:17 A.M.

Monty wrote:

This is from Barclays? You mean it is from Jeff Kvaal who has been touting Nokia since it was $40 a share? This guy should have lost his job long ago. He has been so out of touch with reality and is the one analyst that CONSISTENTLY has been wrong with Nokia and RIMM.

Why he remains bullish on these two companies when time and time again they made a fool of him is beyond me.

Anything coming out from this guy's mouth should be taken with a big grain of salt.

OCTOBER 28, 2011 10:24 A.M.

techy46 wrote:

"the hardware is just a shell and chips that any copy cat can order and assemble" and the iPhones iOS software is just a copy of Linux with mobile phone functions but WP7.5 has all that plus a unique Metro UI with active tiles to eliminate all those iconic dodads. Good artists copy, brillant ones innovate.
.

OCTOBER 28, 2011 10:29 A.M.

rossor wrote:

Manufacturers keep making the mistake of trying to "out-spec sheet" the iPhone. Hint: It's hardware plus user experience that sets the iPhone apart.

Hardware manufacturers keep putting engineers in charge of defining "what works" and this is what you get ... over and over and over.

OCTOBER 28, 2011 10:51 A.M.

Georg Luckmann wrote:

@rossor

despite your barely masked distain for engineers you don't really have a point.

OCTOBER 28, 2011 10:55 A.M.

iDontFollow wrote:

@Thomas in MO

To all that call a bunch of software plus a network plus some remote data an "ecosystem" I say:

This is pretty sad. The prefix "eco" means life. There's no life in the virtual world, even less so in the apple bubble.

Go get a life :-)

OCTOBER 28, 2011 11:02 A.M.

Some Guy, LA, CA wrote:

@Luckman

Of course @rossor has a point and it's glaringly obvious (and his statement is neutral, not disdainful, regarding engineers). Far too many engineers have far too much control on elements of the product that are not their expertise. This applies especially to the user experience. I have been an engineer for over twenty-five years and worked in companies where [especially] software engineers -- not marketing, not usability engineers, not user-facing project personnel -- define, in isolation, what the UI functionality is to be, even what the larger function is to be. They just "know".

As @rossor points out, the less than optimum result occurs again and again...

OCTOBER 28, 2011 11:10 A.M.

Some Guy, LA, CA wrote:

I don't know how Applw works internally, but they obviously have a well-defined architecture FIRST and then design to that. Far too many companies (in many domains, not just those that compete with Apple) have an ad hoc, define-as-you-go, approach to developing a system. The bolted on, stuffing the circle into the square result is what occurs.

OCTOBER 28, 2011 11:24 A.M.

@Tim Henderson wrote:

" BBX will crush them both " Righto mate! They're not going to be allowed to call it BBX dude. Unless they win in court or pay the software company meggabuckadingdongs.

Have you seen the Porsche designed BlackBerry? Hmm. Besides looking old, how does one describe it? Hmm. Let's take a picture of an iMAC and turn it upside down. Yep. Now lets put a picture of an Apple keyboard under it! Presto: Porsche's design for the new BlackBerry P9981. Homage, appropriation, copying and mimicry are the best form of flattery eh. But not to be expected from Porche as far as a creative process goes. Want me to guess what they'll do next? Or where they're getting it?

OCTOBER 28, 2011 11:40 A.M.

Nokia has nothing to lose wrote:

The wp7 isn't mind-blowing, and the phone is pretty ugly. THAT took 9 months to develop? But on the positive side, WP7 is 1-5% of the market, so it has nothing to lose. MSFT can even 'dump' WP7 the way it did with xbox, take a big loss like it does with Bing, to build this "ecosystem" population.

@Tim stop with the pro-RIM posts. I cover RIM, have a $29 target, but the playbook delay is deeply concerning.

OCTOBER 28, 2011 12:18 P.M.

Monty wrote:

@ iDontFollow

The prefix "eco" actually comes from greek... meaning household or habitat.
So before you start ranting and dismissing what Apple creates as an "apple bubble" and everyone to "get a life"....

May I suggest that you go and .... get a real education.
Because whatever you've had hasn't been a very good one.

@baseman, @Monty: Here's a good word with Hellenic roots for you: symphony. Thanks for being in the oikos.

OCTOBER 28, 2011 1:45 P.M.

Anonymous wrote:

The BB P9981 is a $2000 phone!!! RIM is also giving a free Playbook to anyone in India who buys a Curve. And now on RIM's website there's a 2 for 1 PlayBook offer til Dec 31st?! They should also encrust their devices with zircons because Tim Henderson is their perfect campy ambassador....

OCTOBER 29, 2011 6:10 A.M.

Rikkirik wrote:

The Microsoft Nokia combination is the best combination to secure the future of Nokia and WP. Nokia has made a good start with a beautifully designed and functional phone to rival the Iphone. If this is just the beginning for Nokia than the rest (like for example the Nokia 900, with much higher hardware specs than the Lumia) seems very promising. Also LTE, NFC funcionalities and the Tango update (where Nokia's has a bigger role to integrate it's own features compared to the Mango update) in upcomming 2012 windows phones are also things to come. Nokia is still the largest mobile phone manufacturer in the World and we still have to see if Apple and Android based phones can maintain their leadership in sales. The upcomming windows 8 and Nokia's interest in Windows 8 tablets means that Nokia has a new and promising base to sell integrated mobile and tablet devices and who knows, maybe even Nokia PC's and laptobs or notebooks. Yes, Nokia has a great chance to dream of becomming a leading player again which is good for Finland and the world. Even Dell, HP, HTC and others are realizing that Windows 8, giving the 96% dominance of Windows in the PC market, gives them a chance to compete in the hostile mobile and tablet market. This hope of a future is more than a lot of other companies (LG, Sony, Motorolla, since a lot of them are only losing money in the tablet and mobile market and don't have a strategy for the future profitablity in the sector) can say in this competitive market with companies like Microsoft, Google and Apple.

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